Dairy Farmers of America (DFA) and Select Milk Producers will pay a combined $34.4 million to resolve allegations they conspired to suppress milk prices in the Southwest. The settlement, granted preliminary approval by a federal court in New Mexico on July 31, also requires the dissolution of their jointly owned marketing agency, Greater Southwest Agency (GSA).
Why Farmers Sued
Seven dairies filed the case in 2022, accusing DFA, Select, and GSA of violating federal antitrust law. They alleged the cooperatives coordinated on milk pricing, shared confidential pay data, and used selective “depooling” practices to depress prices for raw Grade A milk.
The lawsuit covered dairy farmers who sold milk to the co-ops between 2015 and mid-2025 across New Mexico, most of Texas, and parts of Arizona, Oklahoma, and Kansas.
What the Settlement Includes
-
Financial Compensation: DFA will pay $24.5 million and Select $9.9 million, with funds placed in escrow for distribution to farmers after final court approval.
-
Structural Changes: The dissolution of GSA, which plaintiffs argued enabled price coordination.
-
Non-Monetary Relief: DFA and Select will implement compliance measures, including antitrust training, a ban on sharing non-public milk pricing data, and new educational programs to help farmers better understand payment systems.
Broader Impact
While both cooperatives deny wrongdoing, the settlement delivers significant financial recovery for farmers and introduces new safeguards for transparency. Industry observers say the outcome reflects ongoing tensions over cooperative influence in milk pricing and could set a precedent for how similar cases are approached in other regions.
What’s Next
The court will hold a fairness hearing before granting final approval. Once approved, farmers will be notified about how to claim their share of the settlement.
The case, Othart Dairy Farms, LLC v. Dairy Farmers of America, Inc. (No. 2:22-cv-00251-SMD-DLM), underscores the growing legal and market pressures facing U.S. dairy cooperatives.
